Fortescue to Terminate Power-Supply Deal with TransAlta

By Robb M. Stewart Features Dow Jones Newswires

MELBOURNE, Australia--Fortescue Metals Group Ltd. (FMG.AU) said it will scrap an agreement with TransAlta Corp. (TA.T) to supply power to its operations in northwestern Australia.

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In a statement Monday, Fortescue said it wasn't satisfied that performance conditions under a power-purchase agreement had been met and that discussions with TransAlta had failed to settle the matter. As a result, it said it had issued a notice of termination to the power company.

Fortescue added it continued to obtain power from other electricity suppliers for its operation in Port Hedland.

In early August, TransAlta said the South Hedland power station was fully operational and able to meet all of Fortescue's requirments under the purchase agreement. The 150 megawatt natural-gas power station had received a commercial operation certificate, completed and passed test requirements and obtained approvals from government agencies, it said at the time.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

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November 12, 2017 23:52 ET (04:52 GMT)